Psychological Contract
Psychological Contract definition
The psychological contract
refers to the unwritten set of expectations of the employment relationship as
distinct from the formal, codified employment contract. Taken together, the
psychological contract and the employment contract define the employer-employee
relationship.
Originally developed by organizational
scholar Denise Rousseau, the psychological contract includes informal
arrangements, mutual beliefs, common ground and perceptions between the two
parties.
Developing and maintaining a positive psychological contract
The importance of a high-involvement climate and
suggest in particular that HRM practices such as the provision of opportunities
for learning, training and development, focus on job security, promotion and
careers, minimizing status differentials, fair reward systems and comprehensive
communication and involvement processes will all contribute to a positive
psychological contract.
On the basis of their research, Guest and Conway
(2002) emphasize the importance of communication in shaping the psychological
contract, especially at the recruitment and induction stage when promises and
commitments can be made by employers on such matters as interesting work,
learning and development opportunities, not to make unreasonable demands on
employees, feedback on performance, fair treatment, work/life balance, a
reasonable degree of security and a safe working environment. They concluded
that following the recruitment and induction stage, communication is most
effective if it is personal and job-related. Top-down communication is less
important. They also stressed that a positive psychological contract can only
be achieved if management keeps its word – if it does not breach the contract.
Breach.
A breach in the
Psychological Contract occurs if employees perceive that their firm, or its
agents, have failed to deliver on what they perceive was promised. Employees or
employers who perceive a breach are likely to respond negatively as it may
oftentimes result in an immediate response of mistrust from the other side. Responses
may occur in the form of reduced loyalty, commitment, and organizational
citizenship behaviors. These feelings typically increase negative tension in
the environment. Perceptions that once psychological contract has been breached
may arise shortly after the employees.
Referencing
01. Armstrong, M and Taylor, S (2014) A Hand Book of
Human Recourse Management Practice, Koganpage, 13th ed, UK
02. Rousseau, D. M.
(1989). Psychological and implied contracts in organizations. Employee
Responsibilities and Rights Journal, 2: 121-139
03. Rousseau, Denise M.
"The 'Problem' of the Psychological Contract Considered." Journal of
Organizational Behavior 19 (1998): 665-71. JStor. Web. 14 October 2016.
04. Sandra L. Robinson.
“Trust and Breach of the Psychological Contract.” Administrative Science Quarterly
Vol. 41, No. 4 (Dec., 1996), pp. 574-599. Web. 21 October 2016
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